You do not spawn automatically into the Pod, instead it's a type of menu in which you can customize your Sackperson and read news.
When choosing a material, you are asked if you want it to be static or dynamic. Static means it will remain still, as if it's Dark Matter, whilst Dynamic means it will move about freely like any normal material within the game. This feature was later included in LittleBigPlanet PS Vita and LittleBigPlanet 3.
When you want to play a community level, you must download it to your PSP first.
There's 2 layers that Sackboy can move between and create inside of instead of 3.